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How does demand collaboration in supply chain help businesses?

August 6, 2022 - Team EdgeVerve

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With the dynamics of consumers’ demand shifting frequently, one of the biggest challenges for the Fast-Moving Consumer Goods (FMCG) manufacturers presently is order fulfillment. Subsequently, to meet the demands of this ever-shifting ecosystem, the FMCG, also known as Consumer-Packaged Goods (CPG) manufacturers, should shift their focus from the retailers and distributors to the consumers’ requirements and behavior.

It means that the current focus should be consumer-centric rather than supplier-oriented. To realize this, consumer goods manufacturers should revamp their distribution networks by implementing a more collaborative approach, a multi-network system. This is how the role of demand collaboration in supply chain comes into play.

Going beyond the traditional value chain

Due to the emergence of various new products and the increasing prominence of online commerce (e-commerce) channels, the traditional value chain has almost lost its relevance in the modern-day context, giving space to the multi-source collaborative demand planning approach. Also, the onset of the COVID-19 pandemic has paced up the transformation needs and behavior of the customers, pressing the urgent requirement of a demand collaboration in the supply chain management model.

Hence, it is an indication that this new purchasing behavior will exist and continue for some time now with the customers getting used to the comfort of the home delivery of their ordered products on the same day.

Significant reasons for the failure of the traditional value chain:

The need for an effective demand collaboration approach for FMCG enterprises

An adequate supply chain collaboration platform enables the companies to build up an end-to-end and real-time visibility within the supply and demand network throughout the logistics collaboration supply chain.

That kind of visibility facilitates the retailers and CPGs to nullify the demand distortion impact and avert an array of problems resulting from unanticipated fluctuations to supply and demand signals. Without a collaborative association between all the parties involved, a minute change in demand can twist the communication in the whole supply chain network. However, these problems can be efficiently managed by applying a multi-enterprise, over-the-top supply chain collaboration platform such as TradeEdge Network.

Also, supply chain collaboration helps the companies to better adjust to various pre-COVID-19 trends that have come across since 2020. These include the management of demand volatility and product deficiencies in the supply chain.

How does demand fulfillment approach enhance your business?

Demand collaboration in supply chain enables companies:

TradeEdge Business Network – Connect and collaborate

TradeEdge Network, a proven multi-enterprise, over-the-top platform, enables the FMCG manufacturers to connect and build an ‘all-through’ network chain with the distributors and their partners. This not only maximizes the order fulfillment but also assists in bridging the supply-demand communication gaps in real-time, thus enhancing the visibility within the supply chain. In addition, TradeEdge also helps companies to find a multi-channel supply value network.

Additionally, it enables the involved partners to manage the inventory level strategically in the supply chain after the demand signal is identified. The core objective of this value chain is to form a connected network to check further sales loss.

A use case of a collaborative approach with the TradeEdge platform

By implementing the TradeEdge Business Network solution, one of the premier beverage manufacturers witnessed a sales growth of 2% during the pandemic and thus could rapidly meet consumers’ demands. However, due to panic-purchasing, it could not fulfill the orders on time. Therefore, it employed the TradeEdge platform, connected with the retailers and distributors, improved visibility, and could meet the demands in less than two days.

The future scope of demand collaboration in supply chain

Considering the efficiency of a collaborative demand planning model in the supply chain, the organizations should strategize and design a more connected network of supply chains by leveraging the right demand sensing solution in the coming times. This will not only enhance the visibility in the supply and distribution network chain, but it will also be able to quickly meet the customers’ demand.

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